South Asia: Imported ferrous scrap offers edge down d-o-d on limited appetite

Today, the South Asian ferrous scrap market experienced a downtrend as buyers in India, Pakistan, and Turkiye displayed limited appetite for fresh import bookings. In India, buyers were hesitant to make new bookings due to the availability of cost-effective material in the domestic market. Pakistani buyers showed limited interest due to year-end closing activities and a subdued finished steel sector. Turkish mills have already secured sufficient cargo in the previous week.

Meanwhile, a slight improvement was observed in the Bangladeshi market, with a few deals reported.

Shredded scrap offers saw a decline of $4-5/t d-o-d in India, Pakistan, and Bangladesh. US bulk HMS offers to Turkiye remained stable.

Market overview

India: Recently, in India, no new bookings have been reported, as steel mills maintained ample inventory, resulting in a diminished appetite for imports. Additionally, buyers are inclined towards purchasing materials that have already arrived at lower rates. Indicative offers for shredded scrap from Europe were evaluated at $420/t CFR Nhava Sheva, while HMS (80:20) were heard at $400-405/t CFR. South African hand-loaded HMS (80:20) offers were heard at $415/t CFR.

A trader commented, stating, "The Indian market is relatively quiet, with buyers holding substantial inventory, leading to a limited number of inquiries. Additionally, there is a preference among buyers for materials that were booked earlier and are currently arriving."

Another trader remarked, "Domestic steel mills are grappling with a lack of demand, exacerbated by abundant scrap availability in their yards and low sales of semi's and finished steel. The trader anticipates an uptick in market activities towards mid-January when many mills are expected to engage in replenishing their stocks."

As per market participants, "a mismatch between demand and supply was evident in the domestic market, attributed to stringent checks by income tax authorities. These checks have led to disruptions in trade flow, resulting in suppliers showing reluctance to offload their stocks."

Notably, a prominent steel mill based in Chennai reportedly booked about 5,000 t of HMS (80:20) and 2,000 t of shredded scraps in November.

Pakistan: In Pakistan, limited buying was observed for imported scrap today. Shredded scrap offers from Europe and the Middle East were heard at $430-435/t CFR Qasim.

In the domestic market, local billets were assessed at around PKR 210,000/t while cc billets stood at PKR 2,20,000-2,22,000/t exw. Local scrap prices were heard at PKR 155,000/t exw on cash while PKR 160,000-165,000/t ex Karachi. Around 1,500 t of local scrap was sold at PKR 164,000/t ex Karachi basis, a trader informed SteelMint. He further added, "The purchasing activity for imported scrap is significantly sluggish due to the year-end closing and slow sales of finished steel in the market."

Bangladesh: In Bangladesh, there has been a slight improvement in containerized deals due to their relative cost-effectiveness compared to bulk cargoes. However, the domestic steel sector remains subdued due to limited projects amid the upcoming elections scheduled for January. Shredded scrap offers from Europe were reported at approximately $435-440/t CFR Chattogram, while HMS (80:20) was offered at 420-426/t CFR.

A major steel mill has purportedly secured a bulk cargo of 8,000 tonnes of HMS (80:20) scraps from Singapore at around $430/t CFR.

A representative from a trading firm stated, "Over the past week, a significant amount of material has been booked in containers as container prices are almost $10/t cheaper compared to bulk. However, these are not prompt shipments, as LC opening takes almost 15-20 days."

Turkiye: In Turkiye, bulk HMS (80:20) prices stood at approximately $425/t CFR for Baltic and US shipments. In Europe, domestic ferrous scrap prices rose in December due to the sharp increase in the Turkish import scrap market in November. Northern Europe's domestic shredded scrap reached Euro 365/t delivered, a Euro 20/t increase from the previous month. Despite this, some view the settlement as modest compared to the surge in bulk seaborne HMS (80:20) prices into Turkiye.

The scrap-to-rebar spread is assessed at $180/t, while Turkish exported rebar faced limited sales activity despite offers between $610/t and $630/t FOB.

Recent deals

• About 5,000 t of HMS (80:20) was booked from Australia at $413-416/t CFR Chattogram.
  
  
• Around 1,000 t of shredded scrap were booked from the UK at $428/t CFR Chattogram.
  
  
• Approximately 250 t of shredded scraps were procured from the UK at $410/t CFR Mundra.
  
  

Price assessments

India: The UK-origin shredded scrap indicatives inched down by $4/t to $420/t CFR Nhava Sheva today.

Pakistan: The UK-origin shredded scrap indicatives were down by $5/t to $430/t CFR Qasim today.

Bangladesh: The UK-origin shredded scrap prices were assessed at $440/t CFR Chattogram, down by $5/t d-o-d.

Turkiye: The US-origin HMS (80:20) bulk prices were assessed stable at $425/t CFR Turkiye.

Outlook

The outlook for imported scrap appears uncertain given the current subdued buying interest. However, sources anticipate that full-fledged activities will commence from mid-January as suppliers return from holidays and buyers seek to replenish stocks for the upcoming production cycle.